Prediction Markets: The Complete Guide
Understand what prediction markets are, how they work, which platforms operate in Brazil, and how to start investing in event contracts.
In April 2026, B3 — the Brazilian stock exchange — launched its first event contracts. Kalshi, a billion-dollar startup founded by a Brazilian, opened operations in the country in partnership with XP. BTG Pactual created the Trends platform. And Polymarket, the world's largest prediction market, already has more than 200 active markets about Brazil.
All of this in just a few months. If you're hearing about "prediction markets" for the first time, or you've heard of them but want to really understand how they work — this guide is for you.
What is a prediction market
A prediction market is a platform where you buy and sell contracts on future events. Not on the price of an asset — on whether something will happen or not.
Example: "Will Bitcoin surpass US$ 150,000 by December 2026?"
In this market, there are two contracts:
- YES — you believe it will happen
- NO — you believe it won't
Each contract has a price between R$ 0,01 and R$ 1,00. This price reflects the probability the market estimates. If the YES contract costs R$ 0,72, it means the market collectively believes there's a 72% chance it will happen.
If the event happens, whoever bought YES receives R$ 1,00 per contract. Whoever bought NO loses everything. If it doesn't happen, it's the other way around.
In short: you're investing in your conviction about the future. If you get it right, you get paid. If you get it wrong, you lose what you invested.
How it works in practice
Let's look at a concrete example.
Imagine a market on the Selic rate: "Will the Central Bank keep the Selic rate above 14% at the June 2026 meeting?"
- The YES contract is quoted at R$ 0,65
- The NO contract is quoted at R$ 0,35
- Together, they always add up to R$ 1,00
You believe the Selic rate will fall. You buy 100 NO contracts at R$ 0,35 each, investing R$ 35,00 in total.
Scenario 1: The Central Bank cuts the Selic rate to 13.75%. You were right. Your 100 NO contracts are worth R$ 1,00 each. You receive R$ 100,00. Profit: R$ 65,00 (86% return).
Scenario 2: The Selic rate stays at 14.25%. You were wrong. Your contracts are worth R$ 0,00. Loss: R$ 35,00.
Note two important things:
- You know exactly how much you can win and lose before you enter. There are no surprises.
- The lower the contract price, the higher the potential return — but also the higher the risk, because the market is saying the probability is low.
You don't have to wait for the outcome
One of the differences compared to a simple bet: you can sell your contract before the event happens. If you bought YES at R$ 0,40 and new information pushes the price up to R$ 0,75, you can sell and pocket the profit without waiting for the final outcome.
This creates a dynamic market, similar to a stock exchange, where prices fluctuate as new information emerges.
Why prediction markets work
Prediction markets are not a new idea. They've existed for more than a century — the Iowa exchange has operated a market on US elections since 1988. But only now have technology and regulation made them accessible to millions of people.
The theory behind it is the wisdom of crowds: when many people put money behind their convictions, the resulting price tends to be more accurate than the opinion of any individual expert. Unlike an opinion poll, where being wrong costs nothing, in a prediction market being wrong has a financial consequence. That forces people to be honest with themselves.
The data supports this. In the 2024 US elections, Polymarket called the outcome with accuracy above 94% a month before the vote — beating traditional polls and statistical models.
In practice, prediction markets work like a collective financial thermometer. Companies use them to forecast demand. Investors use them to calibrate risk. Governments are starting to use them to anticipate economic scenarios.
Main platforms in Brazil
Prediction markets arrived in Brazil in force in 2026. Here are the main platforms:
B3 — Event contracts
In April 2026, the Brazilian exchange is launching the first event contracts regulated by the CVM. The initial contracts are on the Ibovespa, the dollar, Bitcoin, and the Selic rate.
Pros: formal regulation, institutional trust, integration with the B3 ecosystem.
Cons: available only to qualified investors (net worth above R$ 10 million). B3 is working to open it up to retail, but with no set date.
To understand the details of how these contracts work, read how B3's event contracts work.
Kalshi + XP — the startup founded by Brazilian Luana Lopes Lara
Kalshi was co-founded by Brazilian Luana Lopes Lara, who in 2025 became the youngest self-made billionaire in the world. The platform is regulated by the CFTC in the United States and is valued at US$ 22 billion. In March 2026, it partnered with XP Investimentos to operate in Brazil through international accounts at Clear Corretora.
Pros: a huge variety of markets (politics, economy, weather, technology), a robust platform, US regulation.
Cons: requires an international account, operates in dollars, English-language interface.
BTG Pactual — Trends
BTG launched the Trends platform, allowing you to trade probability-based contracts tied to assets such as the dollar, the Ibovespa, stocks, and interest rates.
Pros: strong brand, reliable infrastructure, denominated in reais.
Cons: limited initial offering, focused on investors in the BTG ecosystem.
Polymarket
The world's largest prediction platform, with more than US$ 64 billion in trading volume in 2025. It operates with cryptocurrency (USDC) on the Polygon blockchain. It has more than 216 active markets about Brazil, including elections, BBB, and the economy.
Pros: the most liquid in the world, a huge variety of markets, an intuitive interface.
Cons: requires a crypto wallet, operates in USDC (not in reais), no Brazilian regulation.
Brazilian platforms: Prévias, Palpitada, and Futuriza
The national ecosystem is being born. Prévias aims to be the first 100% Brazilian predictive market platform, modeled on Kalshi and Polymarket. Palpitada and Futuriza are also entering the market with their own offerings. Bolsa de Previsões (bolsadeprevisoes.com.br) is another emerging player.
All of them are still in an early stage, but the trend is for at least one of them to establish itself as the "Brazilian Polymarket" in the coming months.
Prediction markets, sports betting, and investing: what's the difference?
This is the most common confusion. Many people hear "prediction market" and think of a betting house. Others think of a stock exchange. In reality, it's a model distinct from both.
| Prediction markets | Sports betting | Investing (stock market) | |
|---|---|---|---|
| Who you trade against | Other participants (peer-to-peer) | Against the house (bookmaker) | Other participants |
| Who sets the price | Supply and demand | The betting house | Supply and demand |
| House margin | Minimal (transaction fee) | High (vigorish/juice 5-15%) | Brokerage + exchange fees |
| Can sell before the outcome | Yes | Usually no | Yes |
| Type of event | Any verifiable event | Sports | Companies and financial assets |
| Regulation in Brazil | Being defined (CVM/Finance Ministry) | Law 14,790/2023 | CVM + B3 |
| Maximum risk | Amount invested | Amount wagered | Can exceed the amount invested (leverage) |
The fundamental difference: in betting, the house sets the odds and profits when you lose. In prediction markets, the price is set by the consensus of all participants — no one is playing against you.
Legally, in Brazil, prediction markets are classified neither as betting (Law 14,790/2023) nor as securities (Law 6,385/1976). They operate under private contractual autonomy, in a regulatory space that is still being defined.
Regulation in Brazil: what you need to know
In 2026, the prediction market in Brazil is in a regulatory gray area. It's not illegal, but it also has no specific regulation.
What we already know:
- The CVM approved B3 to operate event contracts — the first case of formal regulation
- The Ministry of Finance (Secretariat of Prizes and Betting) is discussing the creation of specific rules with the CVM
- The IBJR (Brazilian Institute of Responsible Gaming) has asked for prediction platforms to be regulated under Law 14,790 (the betting law) — legal scholars disagree, arguing it would be like "regulating the stock exchange as a casino"
- Betting on election results is prohibited by the Electoral Court
- The Central Bank does not regulate prediction markets and there is no discussion about it
In practice: international platforms like Polymarket and Kalshi operate legally, and the entry of institutional players like B3 and BTG signals that the market should be formalized soon. The trend is toward regulation, not prohibition.
Important: this article is not legal advice. Consult a specialized lawyer if you have questions about legality in your jurisdiction.
2026 Elections and the World Cup: the big catalysts
Two events are set to make prediction markets explode in Brazil in 2026:
Presidential elections (October 2026): Polymarket already has more than US$ 17 million in active contracts on the Brazilian election, with markets on candidates like Lula and Flávio Bolsonaro. The search volume for "2026 election betting" and "presidential election predictions" is expected to surge starting in July. It's the event that attracts the most interest in prediction markets worldwide — and Brazil will be no exception.
Important: contracts on election results are prohibited by the Brazilian Electoral Court. National platforms (B3, BTG, Prévias) will not be able to offer these markets. But international platforms like Polymarket and Kalshi operate outside Brazilian jurisdiction and already offer them.
World Cup (June-July 2026): Prediction markets on match results, top scorers, and champions are likely to attract an audience that today uses sports betting. The difference is that in prediction markets you trade against other participants, not against the house.
These two events will generate huge search spikes — and those who understand how a predictive market works beforehand will have an advantage.
The connection to binary options
If you trade binary options, you'll recognize the logic immediately.
In binary options, you predict whether the price of an asset will go up or down. In prediction markets, you predict whether an event will happen or not. In both cases, the outcome is binary: YES or NO, up or down.
The differences lie in what you're predicting and in the pricing mechanics:
| Binary options | Prediction markets | |
|---|---|---|
| What you predict | The direction of an asset's price | Whether an event will happen |
| Duration | Fixed (1 min to 1 hour) | Until the event occurs (days to months) |
| Payout | Set by the platform (e.g., 84%) | Set by the purchase price |
| Pricing | By the platform | By the market (supply/demand) |
| Counterparty | The platform | Other participants |
Why this matters for traders: if you've already developed analytical skills, bankroll management, and emotional control trading binary options, those same competencies apply directly to prediction markets. The logic of assessing probabilities and managing risk is the same.
Risks and precautions
Prediction markets involve real risk. Before putting in money, understand:
1. You can lose everything you invested. If the event doesn't happen the way you predicted, your contracts are worth zero. Unlike stocks, there's no "hold and wait to recover" — the outcome is binary.
2. Liquidity can be low. In less popular markets, it can be hard to buy or sell contracts at the price you want. This is especially true on new platforms or in niche markets.
3. Resolution can be disputed. Who decides whether an event happened or not? Each platform has its own resolution rules. Read the terms before trading. Disputes can lock up your capital.
4. Regulatory risk. The legislation is still being built. Rules can change — for better or for worse. Don't invest more than you can afford to lose.
5. Confirmation bias. People tend to buy contracts that confirm what they already believe, regardless of the probabilities. Trading with bias is a recipe for losing money. Base your decisions on data, not on rooting for an outcome.
Golden rule: apply the same bankroll management you would use in any financial operation. Never commit capital you can't afford to lose.
How to get started
If you want to try prediction markets, here's a practical path:
1. Study before you trade. Understand the pricing mechanics (price = probability). Follow a few markets without investing for a week or two. Watch how prices move when news breaks.
2. Start with what you know. If you understand the Brazilian economy, start with markets on the Selic rate or exchange rates. If you follow crypto, go with Bitcoin. Avoid markets on subjects you don't have a handle on.
3. Decide how much you're willing to lose. Before any purchase, decide the maximum amount you're willing to risk. Don't change that limit in the heat of the moment.
4. Diversify. Don't put all your capital into a single contract. Spread it across different markets and different time frames.
5. Start small. Your first purchase should be an amount that makes no difference in your life. The goal is to learn, not to get rich.
Tip for Futura Broker traders: if you already trade with a demo account, use the same mindset here. Treat the beginning as learning, not as investing.
Frequently asked questions
Is a prediction market the same thing as betting?
No. In sports betting, you play against the house — it sets the odds and profits when you lose. In prediction markets, you trade with other participants and the price is set by supply and demand. Legally, in Brazil, they are distinct categories.
Do I need a lot of money to participate?
It depends on the platform. On B3, initial access requires net worth of R$ 10 million (qualified investor). On Polymarket, you can start with a few dollars in USDC. On Kalshi via XP, it depends on the international account. There's no universal minimum amount.
Can I lose more than I invested?
No. The most you can lose is the amount you paid for the contracts. Unlike leveraged operations, there's no margin call.
What events can I trade on?
It depends on the platform. Common examples: interest rate decisions (Selic, Fed), asset prices (Bitcoin, gold), political events (passing of laws), economic indicators (inflation, GDP), entertainment (BBB, the Oscars), sports (the World Cup), and technology (launches, IPOs). Markets on Brazilian elections are prohibited.
Is it safe to invest in prediction markets?
The risk depends on the platform and the market. Regulated platforms (B3, Kalshi) offer more safety. Crypto platforms (Polymarket) carry additional custody and regulatory risk. In all cases, you're exposed to the risk of losing the amount invested.
What's the difference between prediction markets and binary options?
In binary options, you predict the direction of an asset's price within a fixed time. In prediction markets, you predict whether a real-world event will happen or not. The binary logic (YES/NO) is similar, but the object of the prediction and the pricing mechanics are different. Read more about how binary options work.
Prediction markets are just getting started in Brazil. With the entry of players like B3, Kalshi, and BTG, what was once a niche is becoming mainstream. If you already trade binary options on Futura Broker, the transition is natural — the logic of analyzing probabilities and managing risk is the same.
The most important thing now is to understand how it works before putting in money. This guide is your starting point. In upcoming articles, we'll go into detail about each platform, specific strategies, and how to use prediction markets alongside binary options trading.
Want to practice the logic of binary predictions? Create a free demo account on Futura Broker and start trading risk-free.
